Local Vulnerability, Project Risk, and Intractable Debt: The Politics of Smallholder Eucalyptus Promotion in Salavane Province, Southern Laos - Smallholder Tree Growing for Rural Development and Environmental Services - page 263

With respect to the financial after-effects of Phase 1, ADB project officers
recommended - despite the acknowledged institutional shortcomings of the Lao
project partners with the implementation of the credit disbursements - that the non-
performing loans arising from the ITPP should be addressed through a redoubling
of the enforcement of loan covenants by the APB. In an astounding move, which
(perhaps willfully) glossed over the reality of their project's activities in southern
Laos, the ADB project officers forwarded:
“Loan applicants were screened closely by both NAFES and APB, and most farmers and
individuals who qualified for the loans were not particularly poor . The farmers owned
farmland, livestock and various other assets.” (ADB 2005a: 81, italics added )

For critical observers, the ADB approach in the Lao plantation sector raised a series
of red flags. Negotiations for Phase 2 proceeded through 2005 and 2006, however
the ADB and Lao government failed to reach an agreement. A main issue was the
line of authority within the proposed, semi-privatized LPA. Perhaps unsurprisingly,
actors within the Lao Communist Party and the Lao government were uncomforta-
ble with the notion of creating a new institution which would be responsible for a
key resource sector, but which would be managed outside of direct state control. As
of January 2007, the validity period for the Government of Laos to approve the new
loan and grant facility for the FPDP had expired, and the project had lapsed into
inactive status. Soon afterwards, the interim-LPA chief technical advisor, an ADB
consultant, left Vientiane.
While stating that most enrolled farmers were 'not particularly poor', ADB doc-
uments provided little insight into how local farmers interpreted their involvement
in ITPP, or how they viewed the issues and constraints which may have affected
their performance as smallholder tree farm entrepreneurs. What assumptions, for
instance, were packed into the ADB statement concerning a 'questionable motiva-
tion to grow trees' on the part of ITPP smallholder farmers? In the next section, a
closer analysis will inform an understanding of how this forestry promotion pro-
gram functioned in actual communities, and in the political-institutional context of
rural Laos.

13.5 Perspectives on ITPP Smallholder Tree Planting

from Ban Naa Pang Yai, Salavane Province

In this section, I explore the ways in which villager perspectives differed from for-
mal policy and project assumptions and objectives in the ITPP project. I also inter-
rogate how the ADB evaluations and technical assistance documents - considered
here as a set of “second order rationalizations” to a complex set of ongoing events
transpiring in the field sites (Mosse 2005: 132-133) - only selectively incorporated
local perspectives and outcomes into the design for a second project phase. This
section reverses the approach of the paper as presented thus far, and travels from the
field-operational world back to the conceptual, central planning world; or from